In Business This Week: HEADLINER: CHARLES KEATING
GET OUT OF JAIL FREE
Charles Keating, onetime owner of the failed Lincoln Savings & Loan Assn., may symbolize the greed that created the S&L crisis: He left taxpayers with $3.4 billion in losses and left investors holding nearly $250 million in worthless bonds. But on Dec. 3, the day after an appeals court overturned his conviction, Keating, 73, was still unrepentant. "You have to live in the time, period, place you are in. That's what I did," he says.
What now? Keating may finally be off the legal hook. The feds no doubt will contest the ruling, but experts think they will ultimately back down.
Keating, meanwhile, says he's broke. Lincoln bondholders, who won a 1994 civil suit against him, have made claims Keating says will cost him up to $6 billion. Since October, when he was released on bail, Keating has been staying with a daughter in Arizona. "I have five daughters, one son, and 29 grandchildren. I ought to be able to find a place to eat," he says. Meanwhile, the self-described "eternal optimist" says he's scoping out business opportunities.EDITED BY THANE PETERSON By Kathleen MorrisReturn to top
ARCHER DANIELS INDICTMENTS
THE OTHER SHOE FINALLY dropped at Archer Daniels Midland. On Dec. 3, the government handed down long-expected indictments of three of the ag products company's executives for price-fixing: Michael Andreas, the former ADM vice-chairman, now on leave; Terrance Wilson, a recently resigned group vice-president; and Mark Whitacre, former head of one of the ADM units allegedly involved in the scheme. The three face up to three years each in prison and $350,000 in fines. Sources say that Whitacre, the whistle-blower in the case who was fired by ADM in August, 1995, lost his grant of immunity when it was revealed that he took at least $6.5 million in ADM funds. ADM says Whitacre embezzled the money; Whitacre says ADM paid it to him.EDITED BY THANE PETERSONReturn to top
MORE MOVES AT GM
YOU NEED A SCORECARD lately to keep track of the management changes going on at General Motors. First, on Dec. 3, GM's board named two highly regarded CEOs as outside directors: Percy Barnevik of ABB Asea Brown Boveri, the Zurich-based electrical engineering company, and George Fisher of Kodak. The next day, Ronald Zarrella, the marketing chief GM hired away from Bausch & Lomb two years ago, shuffled top jobs at two of the five divisions he oversees. The general sales and service managers of both Buick and Cadillac are retiring and being replaced. Earlier this year, the heads of Oldsmobile and Chevrolet also retired.EDITED BY THANE PETERSONReturn to top
BIG THINKER FOR MERRILL LYNCH
JUST ABOUT EVERYONE WHO has ever run Merrill Lynch has been a former retail stockbroker--at least until the firm announced on Dec. 2 that Herbert Allison, 53, is taking over as president and chief operating officer next spring. The son of an FBI agent, Allison is a seasoned financial manager who was treasurer and chief financial officer before becoming Merrill's investment banking chief. As president and COO, Allison becomes heir apparent to David Komansky, Merrill's new chief executive, who will turn 65 and retire in 2004. Allison calls global expansion his top priority: "The biggest risk we have is if we don't think big enough," he says.EDITED BY THANE PETERSONReturn to top